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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: HH who wrote (3846)	5/25/1998 10:13:00 AM
From: Sam	Read Replies (2) \| Respond to of 9980

I can't claim any understanding of that article. Who's on second? What? I'm on first. No you're out. As the yen collapses, the vaunted Japanese reserves keep dwindling in value. Maybe they need to convert yen to Beany Babies? Or Teeny Babies and Happy Meals?

To: HH who wrote (3846)	5/25/1998 11:29:00 AM
From: MikeM54321	Read Replies (3) \| Respond to of 9980

Heyward, This one is a work in process. You see for years and years, the US has been complaining that the Yen is too weak. You see it's in the US interests for the Yen to get stronger against the US$ because it makes their imports to the US more expensive and makes our exports cheaper for them to import. So Japan always has this in the back of their mind, and politically put on a show of support of their own currency. Well just recently, Rubin and others are fearful of what is going on in Asia in general. Japan in particular. I think the recent spate of bad news concerning the true extent of Japan's debt problems are coming to the surface. I did a recap (post on this board) of the Business Week article a few weeks ago that detailed Japan's debt problems. Rubin and company are starting to worry. They feel they better lay off the Yen issue until the debt problems are worked out. I believe in the latest meeting of Asian countries, in Canada, the Yens' strength pretty much was an untouched subject. Well the markets took this to be a sign that the US is going to quit badgering the Japanese to support it. Hence, it's recent accelerating weakness. The Japanese are just saying they are "supporting" it pretty much for political reasons. I don't think they have a real intent to. Most feel the Yen is heading drastically lower in the coming months. They have bigger problems to deal with in the near term besides the Yen issue. As you know, Greenspan and the Feds held rates at their last meeting. One reason was that Greenspan didn't want to weaken the Asian currencies anymore (Higher rates are more attractive to investors, hence a stronger bias to buy US debt. He even stated this as one of his reasons. Some feel this isn't a good sign because this is history repeating itself. When the US starts acting in support of foreign currencies, it hasn't ended well in the past. MikeM(From Florida)